Here are my top 10 links from around the Internet at 10am. I welcome your additions and comments in the comments below or please send me your suggestions for Wednesday's Top 10 at 10 to bernard.hickey@interest.co.nz We're done with our project...

1.Fall baby fall - Wolfgang Munchau from FT.com makes the case for a weak US dollar to boost its export sector and a strong euro to restrain European inflation. He points to some interesting ideas on current account deficits that New Zealand would definitely fail at its current run rates.

Exchange rates cannot solve the problem of global imbalances. They did not in the past. Reform of the global monetary system is necessary for sustained balance. I agree with the views of Fred Bergsten, director of the Peterson Institute for International Economics in Washington, that the world will ultimately have to move to maximum targets for current account imbalances.

In a forthcoming article in Foreign Policy, he proposes a current account deficit ceiling of 3 per cent of gross domestic product for the US. He also argues that a reduced international role for the dollar would be in the best strategic interests of the US as continued imbalances would end up producing intolerable instability, no matter whether they are financed or not.

Several proposals are floating around for how this could be achieved, for example the creation of special reserve baskets or the use of the International Monetary Fund's special drawing rights. I expect we will see neither but are moving towards a dual system in which the dollar and the euro act as the world's de facto reserve currencies.

2. Greenback grief -  Former US Treasury Deputy Secretary Roger Altman has a prescription to save the US dollar from collapsing. He paints a brutal picture and explains the inexorable pressure down on the US dollar. How much longer can US stocks hold up where they are? How soon before New Zealand has a parity party?

More poor economic data have put Washington in a nearly impossible fiscal position. The US economy requires more stimulus than provided by the original package passed in March. But the dismal deficit outlook poses a huge longer-term threat. Indeed, it is just a matter of time before global financial markets reject this fiscal trajectory.

That could lead to a punishing dollar crisis. To avoid it, America's leaders should commit now and in detail to implement deficit reduction once the economy has strengthened. Vague promises will not work.

For 2011 and beyond, the fiscal challenge is fearsome. A combination of prior tax cuts, years of high spending and a brutal recession have produced the worst budget conditions in 75 years. Through 2019, private forecasts predict deficits averaging $1,000bn a year. In 2019 the deficit would represent 6.5 per cent of GDP and be rising. Worse, national debt will hit nearly 85 per cent of GDP. Annual interest costs on it would exceed the US defence budget and the whole category of discretionary spending. The Treasury's annual borrowing, including refinancings, would average a breathtaking $4,000bn. All this occurs before theMedicare/Medicaid share of GDP explodes beyond 2019.

This debt surge comes against a fragile backdrop. The national savings rate is essentially zero. Net borrowings are being supplied entirely by foreigners. Foreigners already hold half the national debt. Not only do we know, empirically, that massive deficits raise interest rates, cut private investment and depress standards of living. But there is no precedent for financial markets lending such amounts, over 10 years, at anywhere near current interest rates and exchange rates. Indeed, does anyone think that once recovery takes hold and private demand for capital strengthens, the Treasury will raise $4,000bn a year at below 4 per cent, as it is doing today?

3. Hard evidence - Here's detail from Bloomberg about how central banks are moving in euro and yen rather than US dollars.

Policy makers boosted foreign currency holdings by $413 billion last quarter, the most since at least 2003, to $7.3 trillion, according to data compiled by Bloomberg. Nations reporting currency breakdowns put 63 percent of the new cash into euros and yen in April, May and June, the latest Barclays Capital data show. That's the highest percentage in any quarter with more than an $80 billion increase.

World leaders are acting on threats to dump the dollar while the Obama administration shows a willingness to tolerate a weaker currency in an effort to boost exports and the economy as long as it doesn't drive away the nation's creditors. The diversification signals that the currency won't rebound anytime soon after losing 10.3 percent on a trade-weighted basis the past six months, the biggest drop since 1991.

"Global central banks are getting more serious about diversification, whereas in the past they used to just talk about it," said Steven Englander, a former Federal Reserve researcher who is now the chief U.S. currency strategist at Barclays in New York. "It looks like they are really backing away from the dollar."

4. Pound pounded - FTAlphaville looks in detail at the overnight action on the British pound, which is in dire straits, along with the British Government's fiscal outlook.

According to traders, the £16bn disposal plan has underlined once again just how bleak the outlook is for UK public finances. On top of that there is a report from the Centre for Economics and Business Research (CEBR), which says interest rates could stay at 0.5 per cent until 2011,  the GBK could fall below €1.o0 and extra £75bn of paper could be printed.

5. A fabulous crisis - Alan Kohler at BusinessSpectator reckons the big four Australian banks have had a 'fabulous financial crisis' and various government interventions have concreted in their advantage.

Australia's smaller banks and lenders are being crushed by the big four, which have had a fabulous crisis.

Demand for home loans has fully recovered; margins have been maintained or expanded; the big four are totally dominating the markets for both deposits and mortgages; and government policy is discriminating in favour of them and against smaller banks.

CBA and Westpac were allowed to buy BankWest and St George and become behemoths, something the ACCC now regrets, and the government's deposit guarantee actively discriminated against smaller banks, building societies and credit unions.

The sole offsetting factor is the government instruction to the Australian Office of Financial Management (AOFM) to buy AAA-rated mortgage securities, "depending on market conditions".

Christopher Joye has an excellent article this morning detailing how important this has been in providing liquidity to the smaller banks, but he also points that the decision to guarantee bank deposits just about killed the mortgage securities market at the same time.

Americans Invest In Gold